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Growth vs. Margins: Destabilizing Consequences of Giving the Stock Market What it Wants
Stein, Jeremy; Aghion, Philippe - National Bureau of Economic Research (NBER) - 2004
We develop a multi-tasking model in which a firm can devote its efforts either to increasing sales growth, or to improving per-unit profit margins by, e.g., cutting costs. If the firm's manager is concerned with the current stock price, she will tend to favor the growth strategy at those times...
Persistent link: https://www.econbiz.de/10005710833
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The "Other" Imbalance and the Financial Crisis
Caballero, Ricardo J - National Bureau of Economic Research (NBER) - 2010
instead that the root imbalance was of a different kind: The entire world had an insatiable demand for safe debt instruments …
Persistent link: https://www.econbiz.de/10008610950
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Maturity Rationing and Collective Short-Termism
Milbradt, Konstantin; Oehmke, Martin - National Bureau of Economic Research (NBER) - 2014
Financing terms and investment decisions are jointly determined. This interdependence links firms' asset and liability sides and can lead to short-termism in investment. In our model, financing frictions increase with the investment horizon, such that financing for long-term projects is...
Persistent link: https://www.econbiz.de/10010969405
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Governing Misvalued Firms
Kadyrzhanova, Dalida; Rhodes-Kropf, Matthew - National Bureau of Economic Research (NBER) - 2014
Equity overvaluation is thought to create the potential for managerial misbehavior, while monitoring and corporate governance curb misbehavior. We combine these two insights from the literatures on misvaluation and governance to ask 'when does governance matter?' Examining firms with standard...
Persistent link: https://www.econbiz.de/10010950985
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Financial Constraints on Corporate Goodness
Hong, Harrison; Scheinkman, Jose; Kubik, Jeffrey D. - National Bureau of Economic Research (NBER) - 2012
An influential thesis, dubbed "Doing well by doing good," argues that corporate social responsibility is profitable. But heterogeneity in firm financial constraints can induce a spurious correlation between profits and goodness even if the motives for goodness are non-profit in nature. We use...
Persistent link: https://www.econbiz.de/10010950999
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Is a VC Partnership Greater than the Sum of its Partners?
Ewens, Michael; Rhodes-Kropf, Matthew - National Bureau of Economic Research (NBER) - 2013
This paper investigates whether individual venture capitalists have repeatable investment skill and to what extent their skill is impacted by the VC firm where they work. We examine a unique dataset that tracks the performance of individual venture capitalists' investments across time and as...
Persistent link: https://www.econbiz.de/10010951383
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Why Do Firms Become Widely Held? An Analysis of the ynamics of Corporate Ownership
Helwege, Jean; Pirinsky, Christo; Stulz, René M. - National Bureau of Economic Research (NBER) - 2005
We consider IPO firms from 1970 to 2001 and examine the evolution of their insider ownership over time to understand better why and how U.S. firms that become widely held do so. In our sample, a majority of firms has insider ownership below 20% after ten years. We find that a firm's stock market...
Persistent link: https://www.econbiz.de/10005084549
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Behavioral Corporate Finance: An Updated Survey
Baker, Malcolm; Wurgler, Jeffrey - National Bureau of Economic Research (NBER) - 2011
We survey the theory and evidence of behavioral corporate finance, which generally takes one of two approaches. The market timing and catering approach views managerial financing and investment decisions as rational managerial responses to securities mispricing. The managerial biases approach...
Persistent link: https://www.econbiz.de/10009251520
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Capital Allocation and Delegation of Decision-Making Authority within Firms
Harvey, Campbell; Graham, John R.; Puri, Manju - National Bureau of Economic Research (NBER) - 2011
‟s cash flows, and senior management's "gut feel." Corporate politics and corporate socialism are more important allocation …
Persistent link: https://www.econbiz.de/10009277253
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The Cost of Debt
Binsbergen, Jules H. van; Graham, John; Yang, Jie - National Bureau of Economic Research (NBER) - 2010
We estimate firm-specific marginal cost of debt functions for a large panel of companies between 1980 and 2007. The … marginal cost curves are identified by exogenous variation in the marginal tax benefits of debt. The location of a given … company's cost of debt function varies with characteristics such as asset collateral, size, book-to-market, asset tangibility …
Persistent link: https://www.econbiz.de/10008628333